Sam’s problem was this: he had a family business that was doing okay before the recession. Lately, the revenues started declining. He was contemplating retirement for awhile, thinking that it made more sense to him than to labor twelve hours a day for very little return, and this seemed for him a good time to finally take that step.
The problem was that he had ten employees that had been working for him for years and depended on their jobs even more than usual in this tough economy. He didn’t have the heart to tell them that he was thinking to close. Lately, his accountant was saying that he had to either come up with a new idea to revamp his business or he would run out of money by the end of the year. And the longer he waited to make a decision, the less money he would have left in his retirement fund.
Sam did not want to think about reinventing his business. He was done. He had worked all his life and now he was dreaming of a small house in Costa Rica where he could live part of the year in the middle of nature.
“How much longer,” he asked me in the first meeting, “should I tip-toe around my employees
before I break the bad news to them?”
“Do they know that anything is up?” I asked.
“It would be impossible for them not to have figured out by now that sales are down and we are running out of money.”
“If they already know things are bad, perhaps all they would like to find out from you is when they will be out of a job, not if.”
“Yeah, perhaps,” he said with a heavy sigh. “I just can not bring myself to set that meeting. Every week it’s on my agenda and every week I postpone it.”
“When you imagine yourself in that meeting, what makes you the most uncomfortable?”
“Their disappointed faces. The fact that I failed them.”
“Didn’t you want to retire anyway?”
We started talking about how being a business man implies making decisions that make sense from a business standpoint and how he needs to find a way to let go of the image of him retiring in the same fashion as his father. The times are hard and it isn’t his fault. He needed to take back the control of his business.
Holding in his mind’s eye the image of his cottage in Costs Rica where he will not have to deal with business decisions or money or spread sheets did help. Reviewing his ever decreasing saving accounts also helped. But what helped him make his move was the understanding of the psychology of his “tip-toeing.” And that meant understanding his own fear of change.
In fact, his “tip-toeing” behavior had a name: phobic avoidance. It means avoiding something that makes you fearful and uncomfortable, even when you know that avoiding it can cause you more discomfort and harm in the long run; if it is avoided for the moment, it’s a moment longer before you really feel the pain here and now. This was exactly what Sam was doing. He did care for his employees. Still he could have let them go months ago, with good severance packages and good recommendations—all he, as an employer, could be expected to do. They will have to take their chances out there in the work force anyway, as he was ready to retire.
Ultimately, this is what Sam did: he gave them generous bonuses and took the time to write individual letters of recommendation in which he highlighted the merits and qualities of each employee. He then organized a fancy retirement party at an expensive restaurant in town, which allowed him to feel prosperous and benevolent. It also gave him the feeling that he was still in control, even though he had to adjust to a bad economy and harsh business decisions. In other words, he faced his fears and took steps to overcome them.
Using his entrepreneurial instincts, he managed to rise above the situation and solve it. 
To his surprise, his employees took the news very well. They said they knew it was time to close. Some of them were already looking for new jobs. Some of them thanked him for ending their agony of not knowing when and what would happen to their company and had a sigh of relief when Sam brought the situation into the open.
To his surprise, his employees took the news very well. They said they knew it was time to close. Some of them were already looking for new jobs. Some of them thanked him for ending their agony of not knowing when and what would happen to their company and had a sigh of relief when Sam brought the situation into the open.
Everybody understood and supported his decision to retire. It turned out that, using his business contacts, Sam was able to be very instrumental in helping his people find new jobs even in the recession. No one felt let down by the time Sam was through.
At our last meeting, I asked him if he was happy.
“Things couldn’t have gone better,” he answered, patting reassuringly his shirt pocket where he kept his recently purchased Costa Rica plane ticket. “I can’t believe that after all these years in business, I still kept staying in my own way. I was the biggest obstacle to move forward--not the economy, or my business or my employees. I could have done this a year ago.”
“But you did it and it went very well,” I reassured him. “In fact, everybody, even the savviest businessman, has a soft spot. Yours was the concern for your people. Fortunately, you figured out ways to take care of them and at the same time did what’s right for the business. You’ve created a win—win situation. What would your father think?”
He just smiled.
“Thank you,” he said, and then he opened my office door and walked purposefully into his new life’s journey.
Occasionally I get a post card from Costa Rica. He is very happy with his new life. He still remembers our discussion about “phobic avoidance” as the thing that’s always best to be avoided.
Occasionally I get a post card from Costa Rica. He is very happy with his new life. He still remembers our discussion about “phobic avoidance” as the thing that’s always best to be avoided.
Has it ever happen to you to tip-toe around an issue only to discover that the solution was much easier than the tip-toeing?
P.S. I think temporarily I suffer from a "post-Vancouver nostalgia." All the pictures you see in this post are from Vancouver.



Yep, it's like the elephant in the room that nobody wants to talk about. We've had several businesses and ya got to know when to hold 'em and know when to fold 'em.
ReplyDeleteSam is a good boss, not all would be so compassionate toward their employees. I'm so happy he is livin' his dream in Costa Rica.
I popped over to wish you a wonderful Easter weekend. God bless and enjoy your fabulous Friday!!!
Interesting post, Christine. I agree with Nezzy about knowing when to fold 'em. Employees are usually not totally blindsided by a failing business so putting an end to the "guessing game of employment" is a real plus in the big picture. I take my hat off to Sam for helping his employees find new jobs.
ReplyDeleteHappy weekend.
xo